8-K

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT PURSUANT

TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported):  May 13, 2020

NORTECH SYSTEMS INCORPORATED

(Exact name of registrant as specified in charter)

Minnesota	0-13257	41-16810894
(State or other jurisdiction	(Commission	IRS Employer
of incorporation)	File Number)	Identification No.)

7550 Meridian Circle N, Maple Grove, MN 55369

(Address of principal executive offices)

(952) 345-2244

(Registrant’s telephone number, including area code)

Not Applicable

(Former name or former address, if changed from last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

☐  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐  Pre-commencement communications pursuant to Rule 14-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐  Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240. 13e-4(c))

 Securities registered pursuant to Section 12(b) of the Act:

Title of each class:	Trading Symbol(s)	Name of each exchange on which registered:
Common Stock, par value $.01 per share	NSYS	NASDAQ Capital Market

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 2.02 Results of Operations and Financial Condition

The Registrant issued a news release on March 19, 2020, entitled “Nortech Systems Reports First Quarter 2020 Results” regarding its consolidated fiscal year results and financial condition.  A copy of this news release is attached hereto as Exhibit 99.1.

Item 5.07   Submission of Matters to a Vote of Security Holders.

On May 13, 2020, Nortech Systems Incorporated (the “Company”) held its annual meeting of shareholders.  The items voted on at the meeting and the results of such voting are set forth below:

(1) The shareholders elected five directors to serve as members of the Company’s Board of Directors for one-year terms and until their successors are elected and qualified.  The shareholders present in person or by proxy cast the following numbers of votes in connection with the election of directors, resulting in the election of all director nominees:

Nominee	Votes For	Votes Withheld
Kathleen P. Iverson	1,567,639	52,116
David B. Kunin	1,589,967	29,788
Ryan P. McManus	1,589,532	30,223
Jay D. Miller	1,590,014	29,741
Steven J. Rosenstone	1,565,032	54,723

(2) The shareholders approved, on an advisory basis, the compensation of the Company’s named executive officers, as described in the Company’s proxy statement. There were 1,553,297 votes cast for the proposal; 38,905 votes cast against the proposal; 27,553 votes abstained; and there were 713,950 broker non-votes.

(3) The shareholders ratified the appointment of Baker Tilly Virchow Krause, LLP as the Company’s independent registered public accounting firm for the year ending December 31, 2020.  There were 2,317,036 votes cast for the proposal; 7,732 votes cast against the proposal; and 8,937 votes abstained; and there were no broker non-votes.

Item 9.01 Financial Statements and Exhibits

99.1 News Release dated May 13, 2020 (furnished)

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: May 19, 2020

Nortech Systems Incorporated

(Registrant)

/s/ Constance M. Beck

Constance M. Beck

Chief Financial Officer

2

EX-99.1

Exhibit 99.1

May 13, 2020

Nortech Systems Reports First Quarter 2020 Results

MINNEAPOLIS – Nortech Systems Incorporated (Nasdaq: NSYS), a leading provider of engineering and manufacturing solutions for complex electromechanical products serving the medical, industrial and aerospace and defense markets, reported net sales of $27.4 million for the three months ended March 31, 2020, a decrease of 3%, compared to $28.2 million for three months ended March 31, 2019.

Operating income for the first quarter of 2020 was $391,000, compared to a loss of $104,000 for the year-ago period. Net income for the first quarter 2020 was $137,000, or $0.05 per diluted common share. First quarter of 2019 had net loss of $363,000, or ($0.14) per diluted common share. Nortech’s backlog at the end of the first quarter 2020 was $53.0 million.

Like many other companies, COVID-19 continues to significantly challenge Nortech causing supply chain disruptions and workforce issues. Parts deliveries to Nortech have been widely delayed, resulting in slower end-product delivery and delayed customer payments as they carefully manage their cash.

"I want to express my admiration and sincere gratitude to our employees who are managing through this crisis with ingenuity and professionalism. I commend your work ethic and dedication to serving Nortech's customers during this difficult time" stated Jay D. Miller, Chief Executive Officer and President.

Nortech, in partnership with our medical, industrial and defense customers, uses intelligence, innovation, speed and global expertise to provide manufacturing and engineering solutions. This enables our customers to be leaders in digital connectivity and data management to achieve their business goals. Nortech strives to be a premier workplace that fosters valued relationships internally and in our communities.

Efforts to Address COVID-19

Nortech recognizes the seriousness of the current pandemic and is determined to play its role in addressing the outbreak and in minimizing the impact of the coronavirus disease (COVID-19).  Nortech’s highest priority is the safety and well-being of its employees and other members in the Nortech community.  In all of Nortech’s locations, teams have been working diligently to take precautions to ensure a clean and safe environment. Nortech is opting for virtual meetings, minimizing travel, and when possible, asking its team members to work remotely. 

Nortech is also working closely with its suppliers and customers to ensure that it is taking every feasible step to minimize disruption and to continue to deliver the products our customers' need.

The COVID-19 situation is changing rapidly.  Be assured Nortech will continue to monitor the most up to date information from regulatory authorities in the United States, China and Mexico, where its facilities are located.  Nortech senior management is in constant contact and will adapt its response as information is available. 

About Nortech Systems Incorporated Nortech Systems is a leading provider of design and manufacturing solutions for complex electromechanical systems, assemblies, and components. Nortech Systems primarily serves the medical, aerospace & defense, and industrial markets. Its design services span concept development to commercial design, and include software, electrical, mechanical, and biomedical engineering. Its manufacturing and supply chain capabilities are vertically integrated around wire/cable/interconnect assemblies, printed circuit board assemblies, as well as system-level assembly, integration, and final test. Headquartered in Maple Grove, Minn., Nortech currently has seven manufacturing locations and design centers across the U.S., Latin America, and Asia. Nortech Systems is traded on the NASDAQ Stock Market under the symbol NSYS. Nortech’s website is www.nortechsys.com.

Forward-Looking Statements This press release contains forward-looking statements made pursuant to the safe harbor provision of the Private Securities Litigation Reform Act of 1995. While this release is based on management’s best judgment and current expectations, actual results may differ and involve a number of risks and uncertainties. Important factors that could cause actual results to differ materially from the forward-looking statements include, without limitation: volatility in market conditions which may affect market supply of and demand for the company’s products; increased competition; changes in the reliability and efficiency of operating facilities or those of third parties; risks related to availability of labor; commodity and energy cost instability; general economic, financial and business conditions that could affect the company’s financial condition and results of operations; as well as risk factors listed from time to time in the company’s filings with the SEC.

Condensed Consolidated Statements of Operations

(in thousands, except for share data)

	THREE MONTHS ENDED
	March 31,
	Unaudited			Unaudited
	2020			2019
Net Sales	$	27,440		$	28,165
Cost of Goods Sold		24,435			25,204
Gross Profit		3,005			2,961
		11.0	%		10.5	%
Operating Expenses
Selling Expenses		621			761
General and Administrative Expenses		1,993			2,304
Total Operating Expenses		2,614			3,065
Income (Loss) from Operations		391			(104	)
Interest Expense		(224	)		(245	)
Income (Loss) Before Income Taxes		167			(349	)
Income Tax Expense		30			14
Net Income (Loss)	$	137		$	(363	)
Income (Loss) Per Common Share - Diluted	$	0.05		$	(0.14	)
Weighted Average Number of Common Shares Outstanding - Diluted		2,668,590			2,659,859

Condensed Consolidated Balance Sheets

(in thousands)

	March 31, 2020		December 31, 2019
	Unaudited		Audited
Cash	$	730	$	351
Restricted Cash		244		309
Accounts Receivable		20,226		18,558
Inventories		15,363		14,279
Contract Assets		6,774		7,659
Prepaid Expenses and Other Current Assets		2,119		2,128
Property and Other Long-term Assets		13,975		14,408
Goodwill and Other Long-term Assets, Net		3,672		3,718
Total Assets	$	63,103	$	61,410
Accounts Payable	$	16,369	$	14,014
Current Portion of Lease Obligation		1,436		1,415
Other Current Liabilities		5,982		6,803
Long Term Line of Credit		10,255		10,088
Long-term Debt and Other Long-term Liabilities		3,181		3,297
Long Term Operating Lease Obligation, Net		5,789		5,817
Shareholders’ Equity		20,091		19,976
Total Liabilities and Shareholders’ Equity	$	63,103	$	61,410